Companies are drowning in data, but less than 0.5% of all data is analyzed and used. The problem doesn’t lie in generating data but rather in how you capture it. Improving data accessibility by just 10% can result in an additional $65 million in net income for a typical Fortune 1000 company.

Companies have mountains of data stored in paper documents, electronic files, and communications, but that data can’t be useful until you have a way to extract it. Data capture methods can help you unlock more value from your information, allowing you to easily use and analyze it.

Let’s review the definition of data capture, its benefits, data capture solutions, and how Instabase provides a data processing solution that goes beyond data capture. 

What Is Data Capture?

Data capture is the process of extracting information from paper or digital formats (including paper documents and forms, emails, PDFs, and websites) and converting the information into usable machine-readable data. This involves some sort of data capture method, such as manually recording data (e.g., keying in form data), scanning physical documents and using optical character recognition or AI to recognize and extract the text, or collecting data from digital forms in real time.

8 Common Data Capture Methods

Technology has revolutionized the way companies capture data. In the past, manual data collection was the only option. Today, there are two types of data capture options: manual and automated. 

Manual data collection has always been time-consuming and error-prone. It relies heavily on people, which means the outcomes can vary in speed and quality. Automated data capture solves these problems to varying degrees, depending on which method you use. There are several options for automating data capture; some are better solutions for specific data types and formats. 

Optical Character Recognition

Optical character recognition (OCR) converts scanned documents, images, and PDFs into editable, searchable text. It uses templates and pattern recognition to match characters to letters and numbers. As a result, OCR is only highly accurate when extracting printed text, when the image or scan is crystal clear, and when the text isn’t warped or skewed. 

OCR plays a crucial role in automating information extraction from various types of documents such as invoices, forms, and receipts. Organizations can streamline document processing by quickly capturing key information like names, addresses, dates, and account numbers from both physical and digital documents.

Intelligent Character Recognition

Intelligent character recognition (ICR) is a more advanced form of OCR that uses AI to improve the ability to capture handwritten text. OCR struggles with accurately identifying handwriting due to its reliance on templates and the infinite variations in handwriting. ICR uses artificial neural networks instead, which enables AI models to process information similar to that of a human brain. This technology enables ICR to recognize handwriting and even learn and improve over time, increasing its accuracy. As a result, ICR is best suited for capturing handwritten data from forms, invoices, whiteboards, and notes. 

Intelligent Document Recognition

Digital Forms and Signatures

Many forms now come in a digital format, where users can receive the form, electronically sign it, and return it to the sender electronically. These forms automatically capture information as users enter it in and sign it, eliminating the need to convert paper to digital. If they’re integrated with other systems, the information entered can be directly stored there, increasing a business’s operational efficiency. Digital forms and signatures are also more secure, as digital documents can be password-protected and generate an audit trail. 

Barcodes

Barcodes are graphics that involve a series of parallel lines, squares, or dots of varying widths and white space. They store encoded information and work with scanning or barcode reading technology so that, when scanned, they display the embedded data. Barcodes are typically used in retail or logistics settings to quickly retrieve product information or transaction details, though they may also have other uses. 

QR Codes

Web Scraping

Web scraping uses web bots or web crawlers to extract data and content from websites. Businesses can use web scraping to conduct competitive analysis, dissect content strategies, discover pricing strategies, conduct market research, or aggregate job postings, for example.

Voice Capture

Voice capture technology transforms audio into digital data, making data entry easy and hands-free. This audio can come from various sources, such as podcasts, recorded phone calls, songs, or even voice-enabled devices like smart speakers. 

Voice capture also refers to voice-activated interfaces like Siri, Alex, and Cortana, which understand human speech to help users perform actions and get information. For example, users can get the weather forecast, set a reminder, add an item to their to-do list, or play music. 

Using Generative AI to Capture Data With Instabase AI Hub

Generative AI promises a new way to capture data, and Instabase AI Hub is a prime example. By combining generative AI and OCR, Instabase empowers anyone to use natural language prompts to extract the information they need from documents, whether that’s all the contents of a file or specific details. There’s no coding or engineering required, as Instabase’s intuitive interface makes interacting with its AI easy and accessible. Simply upload your documents and start telling the AI the data that you’d like to capture.  

With Instabase, users can also build automated data capture workflows without any engineering or technical expertise. This enables users and teams to automate repetitive tasks, saving time and human resources compared to manual entry. For example, accounting teams can extract information from invoices, HR teams can extract employee details from W-9 forms, and lenders can extract customer information from mortgage applications. The extracted information can also be sent to downstream systems, as Instabase integrates with third-party systems. 

What makes Instabase a powerful data capture solution is that it goes beyond extraction to provide additional capabilities like data validation and data refinement, core components of end-to-end workflows. These capabilities help you clean, standardize, and further process your data for end systems and analysis. 

Benefits of Data Capture

Data capture technology has revolutionized the way businesses gather information. The right methods can save time and valuable resources, along with the following benefits.

Efficiency

Automated data capture helps your entire team work smarter, not harder. It reduces manual data entry, saving you time and allowing employees to focus on more strategic tasks that help your business grow and generate revenue. 

A top five U.S. insurer reduced its average claims handling time from 10 days to two after implementing Instabase, while a leading global investment bank freed up 20 full-time employees to focus on better serving its customers.

Accuracy

By reducing manual data entry, automated data capture systems minimize the risk of human error and ensure data is captured and processed accurately. While any automated data capture method is more accurate than manual data capture, some automated tools are better than others. For example, IDR is more accurate than OCR because it uses AI, rather than templates, to recognize characters. 

Capturing data from documents at scale is a difficult process — one that created a bottleneck at a Tier 1 investment bank. The company struggled to collate, interpret, and action the Standard Settlement Instructions that its clients submitted. Since these documents provide instructions for the final destination of the transfer of securities or cash between financial institutions, maintaining high levels of accuracy is paramount.

Using Instabase, the bank was able to automate the extraction of unstructured natural language, tables, and penmarks from these documents and convert them into structured data that could be mapped to their downstream payments schema. The company achieved an impressive 98% accuracy rate by using Instabase to accurately extract and validate the data before sending it into their downstream settlement system and reduced its handling time by 20% as a result. 

Cost Savings

Reducing manual data entry, as well as the errors associated with it, and streamlining workflows naturally translates into cost savings. A Tier 1 commercial bank is living proof of how much companies can potentially save with automated data capture. With a backlog of 200 million client documents to sort through, the company turned to Instabase to create a better, faster way to extract data and store it in a central platform. Just in Phase 1 of the implementation, the bank saved $2 million while extracting and mapping data for 320,000 client profiles.

Centralized Access

With data spread across many different systems, it’s difficult for businesses to fully make use of it. However, gathering data in one place is a never-ending task that requires continuous human resources when done manually. Automated data capture constantly gathers and extracts data from all of these sources without manual work so that it’s readily available to the right people. 

Security

Automated data capture adds an extra layer of security by reducing the number of paper documents that can get lost or be accessed by unauthorized users. By digitizing their data, companies can also take advantage of several data security features. Data encryption helps prevent unauthorized access, user permissions enable you to give selective access, backups ensure that data can’t be destroyed, and audit trails show you who has accessed the data and if any changes have been made.  

Employee Satisfaction

Data capture technology can alleviate the burden of tedious, detailed manual work that bog employees down. Painstakingly keying in data isn’t rewarding or interesting for employees. By automating this, employees can focus on challenging or creative work. It also leaves more room for employees to upskill and find new ways to innovate and add value to their organizations.

How Industries and Teams Use Data Capture 

Automated data capture offers benefits and use cases to companies in multiple industries. Here are just a few examples of how specific teams and industries can take advantage of these benefits.

Financial Services

Banks, lenders, and other financial institutions can leverage automated data capture to streamline how they verify documents, onboard customers, and make decisions regarding loans and mortgages. For instance, AXA UK used Instabase to increase the capacity of its underwriters so they could focus on making underwriting decisions and reduce the burden of administrative tasks and rekeying data. Data capture can also improve KYC and identity verification processes by extracting information from IDs and other documents that can then be validated.

Healthcare

Healthcare is an industry that sees no shortage of documents, especially handwritten forms and doctor notes. Healthcare clinics, insurance companies, and hospitals can benefit from data capture by automatically converting printed and handwritten documents into digital data rather than requiring employees to manually enter the information into their systems, which saves precious time while elevating the quality of patient care.

Another use case is digitizing paper documents like prescriptions, test results, and consent forms. This improves accessibility to critical information, as healthcare organizations can quickly send and share these documents with patients or other providers, reducing or eliminating the need to organize and store these documents manually.

Legal

Legal documents have a reputation for being dozens, if not hundreds, of pages long. This makes it easy for information to become buried or for specific data fields to be overlooked. Automated data capture can easily extract details within legal documents, enabling employees to quickly find the information they need from a document.

Use cases include contract management, discovery processes, and general communication. In contract management, data capture can pull out critical clauses, dates, and obligations quickly and accurately. This allows lawyers to focus on higher-value tasks. Automated data capture can also enhance regulatory compliance efforts by capturing and maintaining the required information.

Accounting

Reconciling receipts and processing invoices are typical accounting tasks, but manually executing them is time-consuming. Automated data capture helps accounting teams extract receipt and invoice information and input it into their systems, which speeds up reimbursements and payments, potentially helps to detect fraudulent transactions, and creates more accurate financial records.

HR

From new employee onboarding paperwork to payroll, data capture tools ensure employee information enters your systems effortlessly. HR teams can digitize employee records instead of sifting through stacks of paperwork. In doing so, they can devote more time to training, culture, and employee experiences without feeling bogged down in admin work.